KAZAKHSTAN: RESULTS OF BOTA FOUNDATION BOARD MEETING

UNCLAS SECTION 01 OF 02 ASTANA 000812

SIPDIS

STATE FOR SCA/CEN, EUR/ACE, F
STATE PLEASE PASS TO USAID
JUSTICE FOR DANIEL CLAMAN AND BRUCE SWARTZ

E.O. 12958: N/A
TAGS: PGOV PREL EAID SOCI KZ
SUBJECT: KAZAKHSTAN: RESULTS OF BOTA FOUNDATION BOARD MEETING

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1. (U) Sensitive but unclassified. Not for public Internet.


2. (U) This cable contains an Action Request. See para 13.


3. (SBU) SUMMARY: The BOTA Foundation held a meeting of its Board
of Trustees in Almaty on April 29-30. All the items on the fully
packed agenda were reviewed, with many wide-reaching and important
decisions taken regarding operations of the Board. The Foundation's
implementers (IREX and Save the Children) presented well structured
recommendations, and the Board of Trustees adequately debated and
approved them. The next Board meeting will be scheduled for July or
August. Action by the Department of Justice (DOJ) to seek release
of funding is requested. END SUMMARY.

BOARD MEMBERSHIP


4. (U) The Board of Trustees was represented by its five Founders
(Yevgeniy Zhovtis -- Chair and only present on the second day;
Zhamilya Naugmanova -- Acting Chair; Sergey Zlotnikov; Khakim
Sadvakasov; and Akmira Sadykova) and two government representatives
(Pietro Vetrio -- Swiss Government Representative; and John Morgan
-- U.S. Government Representative). BOTA Foundation staff (led by
Executive Director Chris Cavanaugh) was well represented, including
several observers from the implementers' home offices. John Innes
(World Bank observer) joined by DVC on the first day.


5. (U) The meeting began with presentations on the Conditional Cash
Transfer, Social Services, and Tuition Assistance Programs, as well
as an overview of the monitoring and evaluation activities proposed
by the BOTA staff. On the second day, the presentations and
discussions covered administrative, financial, and communications
issues.

CASH FOR THE MOST NEEDY WOMEN AND CHILDREN


6. (U) The purpose of the Conditional Cash Transfer Program, in
addition to improving the health and well-being of poor mothers and
children through direct financial support, is to create increased
demand for social services for people living in poverty. With
increased awareness of appropriate standards of care and service,
the poor will begin to look to their government to provide continued
access to vital social services. The focus will be on pregnant and
lactating women, school attendance (particularly pre-school),and
children with disabilities. The initial program grants will provide
funding to target women who take action to mitigate the impact of
anemia. The Board evaluated data and agreed to conduct programs in
the Kyzylorda and Akmola Oblasts. This decision enables the BOTA
staff to finalize their operational plans, contingent upon the
release of funds (by the U.S. courts).


7. (U) The Social Service Program is the least developed element
being pursued by BOTA. The Board voted to increase the flexibility
of this Program and the BOTA staff was directed to define the grant
structure by the next Board meeting, expected to be held in July or
August.

STRONG DEMAND FOR EDUCATION ASSISTANCE AMONG POOR


8. (U) The Tuition Assistance Program has proven to be a major
success. With a relatively low budget (and thanks to the dedicated
work of BOTA staff),the Program has been announced and the
Foundation has received over 1,500 applications for the 100
anticipated scholarships to be awarded. When the application data
has been entered into a database, 300 candidates with the lowest
income levels will be selected for interviews. The list of 300 will
be determined through a proxy means test, which considers household
assets, household consumption, and household profiling. A selection
committee of 15 independent experts will be formed. This committee
will further screen the applicants through personal interviews
(preferred approach) or structured telephone interviews (where
travel cannot be easily accomplished). The Board was satisfied with
the quality and diligence of the BOTA staff in running this

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Program.


9. (U) Although the BOTA staff had prepared a substantive proposal
for monitoring and evaluation, all agreed that any effort to
evaluate impact would require substantially more than one year's
efforts. The logical framework approved by the Board was thorough
and well structured. Noting the range of issues, the Board
nevertheless applauded the staff's efforts and encouraged them to
continue refining the process.


10. (U) A thorough discussion of administration, finance, and
communications issues was conducted on the second day of the Board
meeting. The Board approved a staff structure of up to 64 staff and
tentatively approved a salary structure. Board concerns about
expatriate staff costs and the local salary structure illustrated
the Board's due diligence and concerns on how to answer any public
questions about the "cost of doing business." The Board approved
efforts by the staff to pursue simplified procurement procedures
with the World Bank. The staff have produced responses to
frequently asked questions about BOTA to facilitate any public
statements by the BOTA Board and staff.

NEXT STEPS


11. (U) The Board concurred with a number of plans for the
near-term. First, a press conference will be called after World
Bank and Board approvals of the annual workplan, which is likely to
occur in June or July. Some minor refinements of the BOTA
Operations Manual were approved. Also, the BOTA Staff were directed
to submit monthly financial reports to the Board for review. And
finally, due to the sensitive nature of upcoming operational
decisions, the Board agreed to move meetings to a quarterly basis
and to restrict meetings to one day in length.


12. (SBU) COMMENT: As with any Board, the complexities of its
disparate members' interactions can impede efficient operations.
For example, Board discussions were occasionally hampered by
comments from Sergey Zlotnikov that were not on point. The Chair,
however, repeatedly guided the discussion back on track. In any
event, Zlotnikov ultimately voted with the consensus of the other
Board members. Another issue impacting participation of Board
members is their availability. Akmira Sasdykova was unable
participate on the second day. Additionally, Khakim Sadvakasov said
he has difficulty getting approval from his supervisor to
participate in the Board meetings. The Board agreed to provide an
endorsement letter (signed by the Board Chair and the BOTA Executive
Director) requesting his participation -- with the anticipation that
this would alleviate this problem. Even with these issues, the
Board is acting responsibly and with due deliberation on its
actions. END COMMENT.


13. (U) ACTION REQUEST: Though these crucial deliberations are
completed, BOTA remains limited in operations until the release of
its funding. The Board was informed that the Government of
Kazakhstan had met its reporting requirements, and that DOJ must now
provide its timely approval of these reports and get approval from
the U.S. courts to authorize the first tranche of funding. We
request that DOJ expedite that approval.

MILAS